Will I be better off with a pay rise?

[Deleted User]

I get working and child tax credits. Single mother work 30 hours on £22k. If I get a pay rise will I be better off/worse off or the same at the end of the day? Might only be £1500 p/a more.

Torry_Quine

Yes as you will be more independent.

[Deleted User]

That wasn't the question.

Will I be financially better off/worse off or the same?

tomtontom

Enter the two sets of figures in a benefit calculator.

Darksparkle

Tax credits will reduce by 41p for every £1 earned (not necessarily straightaway, depends on tax year figures).

So an extra £1500 pa will reduce tax credits by £615 pa.

You'd also pay 20% tax, 12% NIC.

[Deleted User]

Thanks Darksparkle.

The comment about being more independent is rubbish as I still have to depend on having a job, nothing is guaranteed!

Maybe one day I'll be lucky enough not to need tax credits but right now they are a god send.

tomtontom

dalo wrote: »

Thanks Darksparkle.

The comment about being more independent is rubbish as I still have to depend on having a job, nothing is guaranteed!

Maybe one day I'll be lucky enough not to need tax credits but right now they are a god send.

Torry Quine makes an excellent point, being independent means being self sufficient, providing an income based on your own efforts - not being reliant on the state. It is something to aspire to, not to discount as "rubbish".

Darksparkle

dalo wrote: »

Thanks Darksparkle.

The comment about being more independent is rubbish as I still have to depend on having a job, nothing is guaranteed!

Maybe one day I'll be lucky enough not to need tax credits but right now they are a god send.

I wouldn't call it rubbish. If the planned budget cuts had went ahead, you'd have seen a huge cut in your tax credits. Definitely best to try increase earnings where possible.

Could you actually refuse the payrise? If you did then tax credits may still include it anyway as notional income.

[Deleted User]

Darksparkle wrote: »

I wouldn't call it rubbish. If the planned budget cuts had went ahead, you'd have seen a huge cut in your tax credits. Definitely best to try increase earnings where possible.

Could you actually refuse the payrise? If you did then tax credits may still include it anyway as notional income.

Could I put a lot of into my works pension? it's salary sacrifice. I'm only paying 1% at the moment. Maybe I could put 8-10% in meaning most if the pay rise goes into my pension.

Darksparkle

dalo wrote: »

Could I put a lot of into my works pension? it's salary sacrifice. I'm only paying 1% at the moment. Maybe I could put 8-10% in meaning most if the pay rise goes into my pension.

I'd ask your employer/pension provider.

However given you'd be better off, I'm not sure why you wouldn't want the money?

Teahfc

dalo wrote: »

Could I put a lot of into my works pension? it's salary sacrifice. I'm only paying 1% at the moment. Maybe I could put 8-10% in meaning most if the pay rise goes into my pension.

That's what an accountant would suggest, it's no more than taking what the government allows you to.
Regardless of what government say and how little money we have in the treasury we the tax payers get the rough end every time so utilise what ever monies are available to increase your income.